‘The details of the defence corridor announced by the Prime Minister on February 21, 2018, were worked out in 18 days’ time,” Sitharaman said at the ‘Defence and Aerospace Investment Opportunities in Uttar Pradesh’, part of the ongoing ‘Investors Summit-2018″, in Lucknow.
Defence Minister Nirmala Sitharaman on February 22, 2018, lauded officials for working out in a very short span of time the details of the defence industrial corridor in Uttar Pradesh which was announced by Prime Minister Narendra Modi on February 21, 2018.
‘The details of the defence corridor announced by the Prime Minister were worked out in 18 days’ time,” Sitharaman said at the ‘Defence and Aerospace Investment Opportunities in Uttar Pradesh’, part of the ongoing ‘Investors Summit-2018″ in Lucknow.
“When Chief Minister Yogi Adityanath had come to extend an invitation for the summit on February 2 there was a reference about the corridor,” she said.
She said she had mentioned then that if Uttar Pradesh is willing or shows interest then “we will be able to do something… I had mentioned this to the Prime Minister and he immediately asked us to go ahead with it”.
Praising the bureaucracy of both the Centre and the state, she said: “The speed with which we were asked to go about the project and the promptness with which the Chief Minister directed his officials to act on it…officials worked together in complete coordination and there was no complaint from anywhere and Prime Minister made an announcement in 18 days time.”
She said Bundelkhand will benefit from the corridor.
Sitharaman said the atmosphere in Uttar Pradesh in the past 20-25 years did not give any encouragement to industry.
Adityanath said earlier that there are immense possibilities for the defence corridor in the state. ‘There are immense possibilities for defence corridor as well as aerospace.”
India’s defence budget broke into the world’s top five, beating the UK for the first time, a new report by a London-based global think-tank has said, signalling a key shift in the military balance between the two countries.
India overtook the UK as the fifth-largest defence spender in the world in 2017 at USD 52.5 billion, up from USD 51.1 billion in 2016, according to the ‘Military Balance 2018’ report by the International Institute for Strategic Studies (IISS).
In contrast, the UK’s defence budget fell from USD 52.5 billion in 2016 to USD 50.7 billion last year.
“This represents a key shift in the military balance between India and the UK, with India allocating more capabilities to develop its regional resources than the UK in a global context,” said IISS Senior Fellow for South Asia, Rahul Roy-Chaudhury.
The report notes that while India continues to modernise its military capabilities, China with the world’s second- largest defence budget after the US remains far ahead with three times India’s defence budget at USD 150.5 billion.
China’s real defence spending increased by nearly 25 per cent in 2016-17, whereas India’s rose by just 2.4 per cent.
“Post-Dokalam, India’s military balance with China continues to be significantly in China’s favour. Since 2000, China has built more submarines, destroyers, frigates and corvettes than Japan, South Korea and India combined. China will continue to dominate the region militarily and seek to challenge the US in the region as well, Roy-Chaudhury notes.
According to the analysis, the Chinese army has over 600,000 more active personnel than India; it has nearly 1,200 tactical aircraft compared to India’s 785; and 55 more cruisers, destroyers and frigates than India.
The report takes note of the Indian government’s ‘Make in India’ policy, which aims to strengthen the defence-industrial base through measures such as “reforming the cap on foreign direct investment” (FDI) and that the country is one of the top troop contributors to UN peacekeeping operations.
“The overall capability of the (Indian) army is limited by inadequate logistics, and shortages of ammunition and spare parts. Defence cooperation with the US continues to grow, with an increasing level of exercising and sales of US equipment.
“Development and procurement programmes across the services are aimed at replacing ageing equipment, but many projects have experienced significant delays and cost overruns, particularly indigenous systems, the report finds.
IISS says the new Indian Joint Armed Forces Doctrine issued last year sees an “emerging triad” of space, cyber and special-operations capabilities complementing conventional land, sea and air capabilities as India continues to modernise its strategic forces, particularly its delivery systems.
Overall, the report found that China and Russia, with the world’s fourth-largest defence budget at USD 61.2 billion, are challenging the military supremacy of the US (USD 602.8 billion) and its allies and that the West can no longer rely on the strategic advantage it has enjoyed until now.
Saudi Arabia, with a defence spending of USD 76.7 billion, came in third to complete the world’s top five the US, China, Saudi Arabia, Russia and India.
The previous United Progressive Alliance (UPA) government could not agree on the terms under which French defence-maker Dassault Aviation would manufacture Rafale fighter jets in India, and resultant negotiations delayed the acquisition process for the Indian Air Force, the defence ministry said on February 7, 2017, as the opposition scaled up attacks over the deal.
India under the UPA government had floated a tender in 2007 to procure 126 fighter jets, some of which were meant to be made in India. However, the negotiations dragged on. The new National Democratic Alliance (NDA) government after taking over in 2014 scrapped that tender and ordered 36 Rafale fighter for about Rs. 59,000 crore.
The opposition has questioned the deal.
However, the defence ministry said on February 7, 2017, that “contrary to the impression sought to be created by the opposition, in the earlier proposal to procure Rafale, which ended in a stalemate, there was no provision for transfer of technology but only to manufacture under licence.”
The UPA government could not agree on the terms offered. “The government was unable to agree on the terms for even that in its negotiations with the vendor, resulting in the long-drawn exercise under the earlier government ultimately turning futile,” it said.
An email to Dassault on February 7, 2017, evening remained unanswered.
Congress president Rahul Gandhi has questioned the way the deal was sealed and asked why the government has not disclosed the price. “This is the biggest deal for the backbone of the Air Force, but defence minister says we will not tell the country as it is a secret, under a deal struck in Paris…You changed the contract in Paris, did you ask the cabinet committee on security and what price have you paid for the aircraft? Please answer whether you changed the deal yourself, whether you paid more or less and whether you took permission that you were to take. It is simple. But answers are not coming,” he said.
The defence ministry said that the demand that the government disclose the details and value of the contract for the Rafale aircraft contracted in 2016 is unrealistic—in keeping with confidentiality requirements, the UPA government had also expressed its inability to disclose the price of various defence procurements, including in responses to questions in Parliament.
“The approximate acquisition cost of the Rafale aircraft has already been provided to Parliament… in not revealing the item-wise details of the contract, the government is merely following in letter and spirit the confidentiality provisions of a bilateral India-France agreement of 2008 signed by the previous government,” it said.
The defence ministry also rejected opposition questions on whether the government had explored offers by other companies.
“In another effort to twist facts, the government has asked why it did not conduct negotiations with a particular company representing a competing fighter aircraft. It seems to have been conveniently forgotten that the then government itself had rejected that company’s unsolicited offer made days after closure of the bid process, declared Rafale as the L1 bidder (lowest) and had commenced negotiations with it in February 2012,” it said.
Industries and IT Minister KT Rama Rao on February 8, 2018, requested the Union Defence Minister Nirmala Sitharaman to set up Defence Industrial Production Corridor in Hyderabad. Rama Rao handed over a memorandum to the Union Minister in Delhi. The Union Finance Minister announced two Defence Industrial Production Corridors in the Budget.
“I would like you to consider Hyderabad in the proposed Defence Industrial Production Corridor to augment and support the growth of Defence manufacturing in Telangana,” Rama Rao said in the letter. “Telangana is strategically located in the centre of the country and is home to several public sector defence enterprises and DRDO labs including RCI, DRDL, BDL, DMRL, BDL, Midhani, NFC, ECIL, Bharat Electronics, Ordinance Factory, CITD, BHEL and others,” he added.
The State already houses several established private companies working in the Defence and Aerospace sector. Firms like Tata Advanced Systems Limited, MTAR, ATL, SEC, ASTRA, VEM, ZEN, HBL, PEL, IDL etc. have established themselves as manufacturing partners for domestic and foreign OEMs.
Several prestigious National Defence and Space programmes were supported by Telangana based industries, Rama Rao said and requested the Union government to consider Hyderabad for Defence corridor. On the first day of his two-day tour to Delhi, Rama Rao also called on Union Mining Minister Narendra Singh Tomar and invited him to the Mining Today International Conference cum Exhibition to be held in Hyderabad from February 14 to 19.
Rama Rao requested Union Environment and Forest Minister Harsh Vardhan to accord forest and environment clearances to Hyderabad Pharma City on a priority basis.
He explained to the Union Minister that around 84 percent of the drugs required for the country were being imported from other countries. Once the pharma city is established, the import would be drastically reduced while also generating employment, the IT minister said.